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Competition decreases the risks of monopolies and oligopolies from forming. When there's competition, there are more firms that are producing goods/services, so an individual firm can't pick whatever price they want. They must consider what their competitors will charge. Also, some firms may want to supply a small quantity at high prices. Competition forces firms to produce more at a lower price.

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βˆ™ 13y ago
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βˆ™ 12y ago

That's what I'm asking. : D

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Q: What is the purpose of competition in economics?
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